The Citizen (A PUBLICATION OF THE CENTRE FOR ADVANCING JOURNALISM, UNIVERSITY OF MELBOURNE) has published a terrific report into the actions of News Corp. and Nine Media in removing newspaper home delivery from local small business newsagents and putting it under the control of a faceless, contactless mess of an organisation.
I am grateful to Petra Stock for the time she took to understand the issues and speak with some directly impacted. Her reporting on the impact on local family-owned Lygon Media speaks volumes to the disinterest in the offices of News Corp. and Nine Media in delivering a local service for local newspaper readers.
Lygon Media Distributors – a newspaper distribution business co-owned by Fabian Pizzica – made its final delivery run on Sunday, 27 March. Mr Pizzica has been selling or delivering newspapers since 1989, working from age 18 in his father’s Lygon Street newsagent.
In the mid ‘90s, brothers Fabian and Nick joined forces with cousins Robert and Pat (who has since passed away) to form the newspaper distribution arm of the business.
From a few suburban paper runs they grew Lygon Media into a service that stretched from the northern suburbs down to Docklands and Port Melbourne and delivered around 15,000 papers a day.
Lygon Media Distributors closed after newspaper distribution changes. Photo: Petra Stock
Until recently, the family-owned company was one of eight-to-10 remaining larger newspaper distributors, which alongside around 100 smaller newsagents, delivered daily papers around greater Melbourne.
As one of the larger operators, Mr Pizzica says Lygon Media had hoped to win a contract under the new model when News Corp invited tenders last year.
“We were out there buying up territories, increasing the volume. We were spending money and borrowing money to buy more territories, thinking that we’d be big enough for [News Corp] to look favourably on us,” Mr Pizzica says.
But their efforts didn’t deliver a contract. Now, he says, he’s out of a job and the business “isn’t worth anything and we have to pay off debt”.
We’ve all seen, and heard, how upset newspaper customers are with the poor service being provided by the News Corp and Nine Media controlled newspaper home delivery, which can only lead to reduced sales for print editions of their mastheads.
The report by The Citizen provides timely and appreciated coverage.
Personally, I am so lucky to have sold my home delivery runs in 2006, back when they had a good value. But through my newsagency software company, I speak daily with newsagents who did not or could not do this, newsagents who have had tens of thousands, and more, in goodwill ripped from them by the changes to newspaper distribution. This all started in the newsagency channel more than. 20 years ago. Those representing newsagents at the time have plenty to answer for enemy opinion.
Last deliveries for us this Sunday morning. Unfortunately severe labour shortages across the board mean that early morning delivery jobs just can’t be filled particularly in the regions. I am hearing of 11 other NSW regional delivery runs currently being handed in for the same reason. I fear that customer satisfaction with their home delivery service will only continue to decline and that newspaper circulation numbers will rapidly decline. Thankfully we have worked hard over the last 3 years and have repositioned our 2 stores concentrating on new higher margin product lines.
As a customer I am really angry at the poor quality service now provided by Nine Media. Every few days something else goes wrong – non-delivery, delivery of the wrong paper, paper just lobbed onto the footpath instead of the property, or even into the next-door property, continued delivery of the paper during suspension periods – a green light for burglars. For 20 years Lygon Media served me well. Sure, there was the occasional problem, but this could usually be solved with a phone call. The present mob don’t even take phone calls, so I have to spend 20 minutes on the phone to Nine, who then send them e-mails which are ignored. I presume Nine’s strategy is to piss customers off so much that they cancel print subscriptions, and Nine only have to deal with digital.
I used to own a large distribution only business in Melbourne with my brother. About 5 years ago we were looking at a couple of territories that were for sale and considering making an offer when we decided instead to sell. We were sick of the long and early starts, poor service from some of our suppliers, late deliveries, trouble getting good staff, whingeing customers, declining margins, declining sales and having to keep buying more and more territories just to maintain our income. While we sold for less than we bought in for, at least we got enough to pay out our debts and have something left over. I started a new business in a different industry and am now making more money and working better hours. The one thing I regret is when we sold our retail business to become distribution only, I wish we had instead sold the distribution business and become retail only.
Thanks for sharing your story Dean.
Unfortunately, too many left it too late to get out of distribution. I first started advocating newsagents sell their territories in 2004. The market was strong then and there was good money top be made. By late 2007 the prices for territories were falling – but some were still purchasing them, which did not make sense to me.
The newspaper publishers were, in my opinion, less clear than they could have been about what they knew to be the trajectory of the print product even back then.
Kudos on the new business.
More doom and gloom. some newsagents have delivery of subs also, it’s a mixture of both that make it pay also papers are a drawcard,subs don’t mess with the paper bill and fewer people want to get the news from the abc
Unfortunately Eddy the publishers take an all in or all out approach. They continue to ignore the labour shortage crisis and do damage to their own brand.